By Rishi Shah,
Money and Investing Writer
The controversial digital currency Bitcoin is in the news again after the SEC (securities and Exchange Commission) denied bringing it’s ETF (exchange traded fund) to the U.S market.
According to the Economic Times “Investors Cameron and Tyler Winklevoss have been trying for more than three years to convince the SEC to let it bring the Bitcoin ETF to market.”
Here is a little history behind Bitcoin. Initially this system started online when Satoshi Nakamoto created the first currency, it was worthless until he bartered and used 10,000 Bitcoin to buy 2 pizzas. People then began looking for Bitcoin through a system of mining online.
There are only a limited number of Bitcoin on available so intricate computer systems were created to reap the most benefits.
This gave true value to Bitcoin and the price gradually increased. In 2008 one coin was valued a few pennies, recently in 2017 it has surpassed the price of an ounce of gold.
The SEC has its reservations on the idea of recognizing Bitcoin in the ETF market due to its relatively new state of development.
Although moving money around the world is much simpler and efficient with this currency, the claims are that this is too underdeveloped to be used in the masses.
According to Nasdaq “The prospect may be strengthening for Bitcoin, but the SEC needs more proof of the safety in Bitcoin trading. Only then can we expect a Bitcoin ETF. As of now, investors have to be happy with traditional safe-haven assets and gold and silver bullion ETFs”, with any new technology or asset, those who hold high amounts of investment want to feel safe, having Bitcoin disrupt that feeling is not in their best interest at this point.
Seeking alpha put this situation into perspective “While that demand is certainly not going to be kicked into hyper drive now that this ETF has been denied, the SEC has really in essence helped validate the currency as an unregulated and “off the map” reserve for those looking to have a financial asset that exists outside of the normal class of assets that we already have grown used to”.
The SEC sees Bitcoin as a real threat and disrupter of currency, thus validating it efficiency in the global market.
The world has embraced Bitcoin as more and more businesses accept Bitcoin for product.
It is strange the the American economy does not feel the need to support such a revolution that sees no downfall in sight.
With the world more connected and transparent, Bitcoin would help break barriers even further.
This would create a more developed and booming economy for many countries on the rise as they could finally tap into resources that are beyond reach due to restrictions.
After 3 years of fighting for Bitcoins ETF, hope was on the rise and so was the price. After hitting their high of around $1300, Bitcoin plunged to $975 in a matter of minutes after the SEC decided against the ETF. Although a dramatic fall, the price rebounded and is on track to record heights once again.
A version of this article appeared in the Tuesday, March 21st, 2017 print edition.
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